Argg - looks like no one ever answered your question!!
Heres the answer because I was running into the same problem but was able to resolve it.
Did you configure exports for nfs?
Heres the steps I follow:
1) Download ISO and mount it to /mnt/tmp
2) # mkdir -p /mnt/tmp
3) # mount -o loop,ro /home/usename/CentOS5.iso /mnt/tmp (Fedora ISO in your case)
4) Add /mnt/tmp to /etc/export and restart nfs
Run Virt-Install and then when you get to install location in the wizard, enter:
nfs:<DOM0 IP>:/mnt/tmp
Works nicely. Before I got this sorted out, I was using the net option but it was very slow!
-John
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